Job Training Partnership Act: Intertitle Transfers of Funds

DEPARTMENT OF LABOR

Job Training Partnership Act: Intertitle Transfers of Funds

AGENCY: Employment and Training Administration, Labor.

ACTION: Notice.

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SUMMARY: The Department of Labor is publishing for public information a

Training and Employment Guidance Letter on the subject of Job Training

Partnership Act (JTPA) Intertitle Transfers of Funds. The purpose of

this directive is to provide guidance on intertitle transfers and

respond to questions raised on intertitle fund transfer authority.

FOR FURTHER INFORMATION CONTACT: Mr. James Aaron, Director, Office of

Employment Training Programs, Employment and Training Administration,

U.S. Department of Labor, Room 4666, 200 Constitution Avenue NW,

Washington, DC 20210. Telephone: 202-219-5500 (this is not a toll-free

number).

SUPPLEMENTARY INFORMATION: Pursuant to the 1996 Omnibus Appropriations

Act, the Congress authorized the transfers of Program Year 1996 funds

between JTPA titles II-A and III for adults and between title II-B and

II-C for youth. In addition the current authorization in JTPA sections

206 and 266 for the transfer of funds between titles II-A and II-C is

unaffected. This local flexibility provided to service delivery areas

(SDAs) and substate areas (SSAs) in planning and fund transfer requires

the approval of the Governor prior to implementation.

A number of significant policy changes are contained in this

directive and the attached questions and answers. For ease of

reference, they are as follows: a. Notice of Obligations (question 5);

b. Reporting Instructions (question 19); c. Recapture/Reallotment

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policies under title III (Question 14); d. National Reserve Account

application review (question 13); and e. Guidance on inclusions in

State transfer systems (question 4).

Signed at Washington, DC, this 31st day of July, 1996.

Timothy M. Barnicle,

Assistant Secretary of Labor.

U.S. Department of Labor, Employment and Training Administration,

Washington, D.C. 20210

Classification: JTPA.

Correspondence Symbol: TD

Date: July 31, 1996

Training and Employment Guidance Letter No. 7-95

TO: ALL STATE JTPA LIAISONS, ALL STATE WORKER ADJUSTMENT LIAISONS

FROM: Barbara Ann Farmer, Administrator for Regional Management

SUBJECT: Job Training Partnership Act (JTPA) Intertitle Transfers of

Funds

1. Purpose. To provide guidance on intertitle transfers and respond

to questions raised on intertitle fund transfer authority.

2. References.

a. Training and Employment Guidance Letter (TEGL) No. 6-95, JTPA

Titles II-A, II-C, and III Allotments; and Wagner-Peyser Final Planning

Estimates for Program Year (PY) 1996;

b. Emergency Supplemental and Rescission Act, 1995, Public Law 104-

19;

c. Omnibus Consolidated Rescissions and Appropriations Act of 1996,

Public Law 104-134;

d. Job Training Partnership Act, Public Law 97-300, as amended;

e. TEGL No. 5-95, Program Guidance and Allocations for the Calendar

Year 1996 Summer Youth Employment and Training Program;

f. TEGL No. 12-94 and Change 1, Changes in Restrictions on Program

Year 1995 Funds under Title III of the JTPA; and

g. TEIN No. 6-93 and Changes 1 and 2, Instructions for Title II,

JTPA Quarterly Financial Status Report.

3. Background. TEGL 6-95 provided to the States the Program Year

(PY) 1996 allotments for titles II-A, II-B, II-C and III, pursuant to

the Congressional appropriations to the Department. In that

communication, we indicated that guidance on intertitle transfers would

be forwarded separately. Policy concerning transfer rules and

procedures is contained in this TEGL. In addition, in order to be

responsive to the entire employment and training community, questions

were solicited through the Employment and Training Administration (ETA)

Regional offices. The answers to the questions received, including a

reference table summarizing potential transfers for all years, are

contained in an attachment to this TEGL.

In the 1996 Omnibus Appropriations Act, Congress authorized the

transfers of PY 1996 funds between JTPA titles II-A and III for adults

and between title II-B and II-C for youth. The current authorization in

JTPA sections 206, and 266 for the transfer of funds between titles II-

A and II-C is unaffected. This local flexibility provided to service

delivery areas (SDAs) and substate areas (SSAs) in planning and fund

transfer requires the approval of the Governor prior to implementation.

The goals and objectives of ETA, its partners and stakeholders will

remain unchanged as a result of the Congressional appropriations

action. We are committed to help:

a. Low income adults and youth get the skills and training they

need, and help them find first, new or better jobs; and

b. Laid off workers find new jobs that pay as close as possible to

what they used to earn.

4. Significant Changes. A number of significant policy changes are

contained in this TEGL and the attached questions and answers. For ease

of reference, they are as follows:

a. Notice of Obligations (Question 5)

b. Reporting Instructions (Question 19)

c. Recapture/reallotment policies under title III (Question 14);

d. NRA application review (Question 13); and

e. Guidance on inclusions in State transfer systems (Question 4)

5. Principles. As the questions being raised were considered, it

became apparent that a series of principles evolved which may be of

assistance in responding to further questions.

a. Keep it Simple. The Department has attempted to limit potential

problems by minimizing Federal reporting and record keeping

requirements by combining PY 1996, title II-A, II-C and III formula

funds into a single financial account on the upcoming Notice of

Obligation and the Health and Human Services financial payments

account. FY 1996 title II-B funds will remain under the PY 1995 grant

agreement and the previously assigned accounts. No prior notice will be

required when making transfers, but quarterly reporting must reflect

any changes made.

b. Identity of Funds. Once the funds are transferred, there is no

separate identification; they become part of the total funds available

in the receiving title/part. The transferred funds are subject to all

of the rules of the receiving title/part, including cost limitations,

and eligibility requirements. However for auditing purposes, records

must be maintained by title.

c. Funds Authorized for Transfer. Only funds allocated to SDAs/SSAs

are authorized for transfer between title II-A and title III, and among

titles II-A, II-B and II-C. Title III discretionary NRA and Governors'

reserve, as well as title II incentive funds are not authorized for

transfer. Only PY 1996 funds may be transferred between titles II-A and

III, e.g., no carryover PY 95 funds may be transferred.

d. Reporting. Expenditures associated with transferred funds are

not tracked or accounted for separately; they are reported as part of

total available funds in the receiving title/part.

e. Services to Participants. Commitments in State and local plans

that describe strategies and goals established prior to transfers must

be considered when addressing potential transfers. Modification

requirements will remain unchanged.

f. Program Performance Requirements. Performance standards apply to

titles and the funds expended under those titles.

The above principles are addressed more fully in the questions and

answers that are contained in the attachment.

6. Effective Date. Upon receipt.

7. Action Required. States are requested to:

a. Incorporate the guidance contained in this TEGL in their:

(1) Direction to private industry councils, chief elected

officials, title II administrative entities and title III substate

grantees; and

(2) Criteria, systems and procedures to permit SDAs and SSAs to

transfer funds; and

b. share the information contained in this directive with service

delivery areas and substate areas.

8. Inquiries. General questions or requests for technical

assistance should be directed to the appropriate Regional office.

Questions dealing with title III issues on recapture/reallotment and

NRA grants should be directed to Zen Choma (202) 219-5577 x127 and

Brian Deaton (202) 219-5336 x107 respectively.

9. Attachments.

a. Questions and Answers--JTPA Intertitle Fund Transfers (including

Sample Quarterly Financial Reports)

b. SDA/SSA Intertitle Transfers Authority Table

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Attachment 1--Employment and Training Administration Questions and

Answers--JTPA Intertitle Fund Transfers

Question 1:

What is the exact language for the transfer of funds?

Answer:

The language is from four sources:

1. Job Training Partnership Act (JTPA),

2. FY 1995 Rescission Bill (Public Law 104-19),

3. FY 1996 appropriations bill (Public Law 104-134),

4. Appropriations Conference Report (Congressional Record, April

25, 1996, page H 3953).

1. JTPA

a. Section 206 (title II-A): ``A service delivery area may transfer

up to 10 percent of the amounts allocated to the service delivery area

under section 202(b) to the program under part C if such transfer is--

(1) described in the job training plan, and

(2) approved by the Governor.

Note: Underlining added for emphasis and to clarify that the 10%

applies only to the amount allocated to the SDA under the formula,

and does not apply to other funds that have been transferred into

the program from another program.

b. Section 256 (title II-B): ``A service delivery area may transfer

up to 20 percent of the funds provided under this part to the program

under part C if such transfer is approved by the governor.''

c. Section 266 (title II-C): ``A service delivery area may transfer

up to 10 percent of the amounts allocated to the service delivery area

under section 262(b) to the program under part A if such transfer is--

(1) Described in the job training plan, and

(2) Approved by the Governor.''

Note: Underlining added for emphasis and to clarify that the 10%

applies only to the amount allocated to the SDA under the formula,

and does not apply to other funds that have been transferred into

the program from another program.

2. FY 1995 Rescission Bill (PL 104-19): ``* * * Provided further,

That service delivery areas may transfer up to 50 percent of the

amounts allocated for program years 1994 and 1995 between the title II-

B and title II-C programs authorized by the Job Training Partnership

Act, if such transfers are approved by the Governor.'' This language

overrides the JTPA language regarding transfers for funds appropriated

in PY 1994 and PY 1995 for the II-B and II-C programs, i.e., the 50%

overrides the 20%, and authorizes for the first time transfers from II-

C to II-B.

Note: Underlining added for emphasis and to clarify that the 50%

applies only to the amount allocated to the SDA under the formula,

and does not apply to other funds that have been transferred into

the program from another program.

3. FY 1996 appropriations bill language (Pub. Law 104-134):

``Provided further, that service delivery areas may transfer funding

provided herein under authority of titles II-B and II-C of the Job

Training Partnership Act between the programs authorized by those

titles of that Act, if such transfer is approved by the Governor:

Provided further, that service delivery areas and substate areas may

transfer funding provided herein under authority of title II-A and

title III of the Job Training Partnership Act between the programs

authorized by those titles of the Act, if such transfer is approved by

the Governor: * * *''

The above language pertains to the funds appropriated under the FY

1996 bill: PY 1996 title II-A, title II-C and title III funds, and FY

1996 II-B funds.

4. Conference Report: ``The agreement includes language to permit

service delivery areas to transfer funds between titles II-B and II-C

of the Job Training Partnership Act, with the approval of the Governor

of the State. The House and Senate bills only permitted the transfer to

take place from title II-C to title II-B. In addition, the agreement

permits the transfer of funds between title II-A and title III of the

Act as proposed by the Senate, instead of permitting the transfer of

funds between all title II programs and title III as proposed by the

House.''

Note: Transfers were not permitted between titles III and II-C.

Attachment 2 shows the intertitle transfers that are authorized

among titles II-A, II-B, II-C, and between title II-A and title III.

Question 2:

How will this authority affect service delivery area (SDA)/substate

area (SSA) programs?

Answer:

The authorization is to provide States and local communities with

the flexibility to design programs and allocate resources to best serve

the employment and training needs of dislocated workers and

disadvantaged youth and adults. The intent is also to allow greater

flexibility as the system moves toward an integrated workforce

development approach to consolidate programs and give greater authority

to State and local decision makers.

States and SDAs are encouraged to use this new transfer authority

to assist them in their development of integrated workforce development

systems which incorporate One-Stop Career Centers, School-to-Work

systems, and integrated systems for serving disadvantaged and at-risk

youth. For further program guidance see TEGL No. 4-95, dated February

21, 1996.

Question 3

What are the beginning and ending dates for spending the funds, and

when can transfers be made?

Answer

The beginning and ending dates differ according to different

legislative provisions.

Section 161(b)(1) applies to funds appropriated on a program year

basis and states: ``Funds obligated for any program year may be

expended by each recipient during that program year and the two

succeeding program years * * *'' For clarification purposes the word

``obligated'' in the first line of section 161(b)(1) pertains to the

Federal obligation of funds (through a Notice of Obligation) and not to

the recipient's obligation of funds.

Thus, the above language applies to program year funds, but does

not apply to the FY 1996 II-B funds. (These FY title II-B funds are

available for up to five years for expenditure, but it is assumed that

they will be expended within the grant period). However, should FY 1996

II-B funds be transferred to the PY 1996 II-C program, those funds can

be expended during the life of the PY 1996 II-C funds (6/30/99). On the

other hand, should PY 1996 II-C funds be transferred to FY 1996 II-B,

the transferred funds retain their PY 1996 II-C life. Only PY 1996

funds may be transferred between title II-A and III; therefore, the

transfers could occur any time between July 1, 1996 and June 30, 1999

or until funds are expended, whichever occurs first.

The attached table summarizes the intertitle transfer rules for

each year of funds. The year of the funds determines the rule to be

followed in transferring the funds. For example, PY 1995 funds

available for expenditure in PY 1996 may be transferred based on PY

1995 allocation base and according to PY 1995 rules. (PY 1995 funds

expended in PY 1996 cannot be transferred by PY 1996 rules.) The

transfers can be made at any time during the life of the funds.

Question 4

What is the Governors' role in approving transfer requests?

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Answer

The Governor is responsible for establishing procedures and

approval criteria for processing transfer requests, as well as

accounting and reporting procedures for tracking these funds. It is

expected that the Governor will establish policy on transfers. The

procedures should include the State Job Training Coordinating Council

pursuant to its advisory responsibilities to the Governor regarding

resource allocations. [Sec. 122(b)(2)] These procedures may also

include, at the Governor's discretion, modifications to SDA/SSA Job

Training Plans and procedures for the timing and frequency of

transfers. In considering transfer requests, the Governor should ensure

that procedures are in place that will address the employment and

training needs of eligible JTPA program participants within the SDAs/

SSAs and the State as a whole to assure the maintenance of adequate

funding levels.

Approval criteria established by the Governor should include, but

are not limited to, such factors as:

1. Policy established by Governors in the Governor's Coordination

and Special Services Plan (GCSSP), including the Governor's Statement

of Goals and Objectives. [Sec. 121]

2. Impact on GCSSP coordination responsibilities under Sec.

121(b)(1), 205, and 265.

3. Impact on jointly funded employment and training programs.

[121(c)(11)]

4. Impact on existing agreements for the delivery and/or

coordination of employment and training services.

5. Impact on current State, SDA or SSA employment and training

systems.

6. Changes in labor market conditions.

7. The extent to which the proposed transfer improves the delivery

of employment and training services.

8. Comments from stakeholders and the public regarding resource

utilization, e.g., transferring funds to and from disadvantaged and

dislocated workers and to/from youth programs and II-A programs.

9. Impact on the employment and training needs of eligible

participants in the SDA, SSA or State from which funds have been

transferred.

10. Consistency with local plans.

Question 5

What changes are planned for the 1996 Federal Notice of Obligation

and the authorizations maintained in HHS's Payment Management System?

Answer

With the increased latitude to transfer funds between titles and

our objective to minimize recordkeeping requirements, the PY 1996

titles II-A, II-C and III formula funds will be combined into one

financial key on both the Notice of Obligation (NOO) and in the HHS

Payment Management System (PMS). The backup to the NOO will provide the

specific amounts for each title.

Because the 1996 Appropriations bill identifies the title II-B

funds as FY 1996 funds (instead of PY funds) II-B funds will be

accounted for separately and will remain in the PY 1995 grant

agreement. These funds will be separately identified in the NOO and in

PMS.

Notes:

1. For accounting ease, a State may wish to assume that the

funds transferred into PY 1996 II-C from FY 1996 II-B and the funds

transferred into FY 1996 II-B from PY 1996 II-C are expended first

and corresponding cash is drawn down first. (The life of the

transferred funds, however, should be considered in making this

decision.)

2. The Administration has requested funding for the 1997 summer

program. These funds would be FY 1997 funds (not PY funds) and would

be added to the PY 1996 grant agreement and accounted for

separately, similarly to how the FY 1996 II-B funds are handled.)

Question 6

What is the identity of transferred funds?

Answer

Transferred funds always retain year of appropriation identity.

(For FY 1996 title II-B funds, see answer to Question 3.)

When funds are transferred to another title, they take on the

character of that title and are therefore subject to all of the rules

and regulations of the receiving title and Part. This includes cost

limitations, eligibility requirements and provision of services.

Question 7

How are cost limitations applied to transferred funds?

Answer

Funds are transferred in the total amount and do not take on cost

category identity until they are expended. Transferred funds are

subject to the rules and regulations of the receiving title/part. Funds

are not transferred by cost category. The remaining funds left in a

title continue to be expended under requirements of that title.

The FY 1996 Appropriations Bill provides for cost limitation

flexibility for PY 1996 title III formula funds. Similar flexibility

was provided for PY 1995 funds (see TEGL 12-94, dated May 31, 1995).

Question 8

When transferring funds from one title to another, will the

performance standards remain attached to the funds?

Answer

When funds are transferred from one title to another, the

performance standards that apply to the titles are not changed. For

example, when title III funds are transferred to title II-A, the

additional resources should result in an increase in II-A expenditures.

The enhanced program will be subject to the performance standards in

title II-A.

When individuals (not funds) transfer titles, the performance

standards of both titles apply. The program has a choice of either

enrolling the participant in both titles or terminating the person from

the original title and enrolling the individual in the receiving title.

In the latter case, the originating title may incur a negative

termination, particularly if the transfer is from II-A to III. When

programs choose to co-enroll the person in both titles, the person's

outcome is subject to standards in both titles.

Question 9

Should prior notice on transfers be provided to the Federal Grant

Officer? How will the Department learn of these transfers?

Answer

No prior notice is required to the Department relative to

transfers. However, DOL will require the reporting of transfers that

have been made. This will be shown on the quarterly reports submitted

to ETA (see Question 19.)

Question 10

What is the base for computing maximum allowable transfers?

Answer

The transfer of funds is limited to funds that have been allocated

to the SDAs by the State, i.e., the 77%/82% formula funds and the funds

allocated to SSAs by the Governor from the title III formula allotment.

The 23 percent in title II-A, 18 percent in title II-C and the formula

funds reserved by the Governor in title III are not available for

transfer.

Question 11

Can transferred funds be used at the State level to increase set-

aside funds (e.g., administration)?

Answer

No. The use of transferred funds is only at the SDA/Sub-State

levels, and

[[Page 43786]]

not at the State level. Thus, these funds cannot be used for State

level costs.

Question 12

Are title III Secretary's Discretionary Funds (National Reserve

Grants) available to transfer to title II-A?

Answer

No. Only formula funds allocated to the SSA by the Governor from

the State's title III formula allotment are available for transfer.

Question 13

What is the impact of the transfer of title III funds to title II-A

on the State's ability to request NRA funds?

Answer

NRA requests are always reviewed in terms of other resources

available and systems that can provide the necessary assistance without

additional funds. Generally, NRA funds will not be made available to

provide services that could have been provided with title III formula

funds allotted to a State (including funds that have been transferred

to II-A).

ETA will review and evaluate applications for NRA funds in the

following manner in SSAs where funds have been transferred from title

III to title II-A:

If not more than 20 percent of the applicable substate

formula allocation has been transferred, States may apply for NRA funds

without restriction.

If more than 20 percent of the applicable substate formula

allocation has been transferred to title II-A, the State and/or

substate area will be required to provide a financial match for any NRA

funds awarded. The required match will take into account the level and

rate of expenditure of title III funds available for the Program Year,

and the amount of title III funds transferred to title II-A at the time

an application for NRA funds is submitted.

Exceptions will be considered in certain circumstances such as

temporary job creation in response to natural disasters, assistance to

workers impacted by BRAC-related closures, mass layoffs and plant

closures without notice or in other situations as approved by the

Secretary.

If more than 50 percent of the applicable substate formula

allocation has been transferred to title II-A, the State and the

substate areas are certifying that there is not an expected need in

that substate area to provide assistance to a substantial number of

dislocated workers and will not qualify for NRA funds, exclusive of

natural disasters or BRAC-related closures, for the PY covered by the

formula allocation. Other NRA requests will be considered only when it

is demonstrated that the title III funding level for the substate area

is at least 50 percent of the initial formula allocation level, e.g.,

transferred funds may be returned to title III.

Notwithstanding these criteria, the Secretary retains the

discretion to obligate NRA funds in a manner that targets resources to

areas of most need and that promotes the effective use of funds for

eligible dislocated workers.

Question 14

How does this transfer authority affect the title III recapture/

reallotment policy (Sec. 303) and the title II-A recapture/reallotment

policies?

Answer

The answer to this question is dependent upon which title's funds

are involved.

The JTPA, section 303, requires the Secretary to recapture from

States unexpended Title III formula funds in excess of 20% of the

annual formula allotments to the States. For the purpose of including

the inter-title transfer authority, the net allotment for determining

funds subject to recapture will be used and calculated as follows:

* The initial title III allotment to the State at the beginning of

the program year;

* Plus or minus the increase or decrease in the allotment as a

result of recapture/reallotment activity; and

* Plus or minus the net increase or net decrease as a result of

inter-title transfers into or out of Title III.

Therefore, maximum amount of carryover from the year of allotment

to the next program year is the amount of the allotment, as adjusted

for reallotment and fund transfers, (i.e., net transfers from title II-

A to title III will increase the funds available and 20 percent of that

larger amount can be carried forward without recapture; net transfers

from title III to title II-A will decrease the funds available and 20

percent of that smaller amount can be carried forward without

recapture). It is expected that a consistent policy for determining

excess unexpended funds at the substate level will be followed by the

states when applying their own reallocation procedures.

The JTPA, section 109(b) requires the Secretary to reallot to

eligible States, Title II-A and II-C unobligated funds in excess of 15

percent of each State's allotment. However, since Title II reallotment

procedures apply only to unobligated funds and since transfers can only

occur at the substate level, there is no impact on Title II reallotment

procedures, i.e., funds at the SDA/SSA level have, by definition, been

obligated by the State. It is expected that Title II substate

reallocation procedures [Sec. 109 (a)] will be affected by the new

transfer authority. Therefore, a transfer of funds from title II-A to

title III would lower the base against which unobligated funds in

excess of 15 percent would be determined. A transfer of funds from

title III to title II-A would increase the base against which the

determination is made.

Question 15

Will the allocation formula be affected by transfers that have

taken place in a previous year?

Answer

No. The same formula will be used, regardless of any transfer

action in previous years.

Question 16

What State Level Plan Modifications are required for titles II and

III?

Answer

The requirements differ for the two titles.

GCSSP: Section 121(b)(7) of the Act provides that if major changes

occur in labor market conditions, funding, or other factors during the

two-year period covered by the plan, the State shall submit a

modification to the Secretary describing the changes. This is further

clarified in the GCSSP planning guidance which includes the OMB

approved format for modifications. Specifically, it states that if

major changes occur in labor market conditions, funding, or other

factors during the period covered by the plan, the State shall submit a

modification describing these changes. For the purposes of determining

if a modification is necessary, a major change is defined as cumulative

change of 20 percent of these factors in the plan.

Title III Biennial Plan: There is no requirement that title III

State plans be modified to show increases in allotments or available

funds to the States or to the Substates: therefore, no modifications

would be required by the Department for any transfers made into or out

of title III. That information can be collected from Quarterly

reporting discussed elsewhere.

Question 17

When SDAs request State approval to transfer title II funds, are

they required to submit modifications to their job training plans?

[[Page 43787]]

Answer

Yes, in accordance with instructions established by the State

(except in the case of the Single State SDA as noted below).

Section 104(c) of the Act provides that if changes in labor market

conditions, funding, or other factors require substantial deviation

from an approved job training plan, the private industry council and

the appropriate chief elected official or officials (as described in

section 103(c)) shall submit a modification of such plan (including

modification of the budget under subsection (b)(6)), which shall be

subject to review in accordance with section 105 of the Act.

Further, Section 628.420(e) of the JTPA regulations provides that

the (1) any major modification to the SDA job training plan shall be

jointly approved and jointly submitted by the PIC and the chief elected

official(s) of the SDA to the Governor for approval. (2) For the

purposes of this section; the circumstances which constitute a

``major'' modification shall be specified by the Governor.

In the case of Single State SDAs, Section 105(d) of the Act

provides that when the SDA is the State, the Governor shall submit the

job training plan and any modifications to the Secretary for approval.

The State SDA submission requirements are further clarified in Section

628.430 of the JTPA regulations. The Act and the regulations do not

make a distinction between major or minor modifications to a Single

State SDA's job training plan. This would indicate that all plan

modifications must be submitted to the Secretary. However, so as to be

consistent with the provisions which apply to major modifications to

the GCSSP, States will be required to submit modifications to the

Secretary for approval when there is a cumulative change of 20 percent

in labor market conditions, funding, or other factors during the period

of the plan.

Question 18

When SSAs request State approval to transfer funds, are they

required to submit modifications to their substate title III plans?

Answer

Yes. The governor will establish guidelines. However, under Section

313 of the Act, substate plans (or modifications thereto) must be

submitted to the Governor describing the manner in which activities

will be conducted within the SSA area with the funds obligated to the

area. ETA believes a transfer of funds from title III to serve

individuals who are not eligible for Title III would constitute how

title III funds will be utilized in that SSA. Public review provides

appropriate input into such a decision. It is expected that any

transfer decision would be based upon an analysis of the local labor

market and the needs/availability of individuals who are eligible to

receive services under the various titles.

Question 19

What are the rules for reporting transferred funds?

Answer

After funds are transferred, they are expended under the rules and

regulations governing the receiving title and/or part. Total available

funds are increased and expenditures associated with transferred funds

are, therefore, reported against available funds in the receiving title

and/or part. The transferred amount should be recorded on both the

sending and receiving reporting forms in the appropriate columns and

line items as described below and in the attached examples.

Note: The title II and title III financial reports are State

summary reports. Since the transfers are made at the SDA/SSA level,

the transferred amount shown on the State summary report is a net of

the SDA/SSA transfer actions. In addition, the report entries for

title II-A can reflect the net of transfers from both title III and

from title II-C; and, title II-C can reflect the net of transfers

from title II-A and from FY 96 II-B.

Sample quarterly financial reports are attached, showing offsetting

entries. Following is further clarification with regard to each of the

reporting forms.

1. Title II Job Training Partnership Act (JTPA) Quarterly Financial

Report--(JQSR)

a. Title II-A and II-C. Follow the reporting instructions issued in

TEIN No. 6-93, plus Changes 1 & 2, for reporting transfers within title

II. There is no change in the treatment of transfers between II-A and

II-C.

b. Title III. Transfers to or from title III should be identified

in the Remarks Box as a cumulative net amount to reflect a net plus or

minus dollar change to available II-A funds. The comment should also

identify both the sending PY and title/part and the receiving PY and

title/part. (See sample JQSR).

--In addition, the effect of the transfer should be reflected on Line 2

of Column (A).

--Line 18 of Column A must also equal Line 2 of Column A.

c. Title II-B. Transfers to or from FY 1996 title II-B should be

identified in the Remarks Box as a cumulative net amount to reflect a

net plus or minus dollar change to available II-C funds. The comment

should also identify both the sending PY/FY and title/part and the

receiving PY/FY and title/part. (See sample JQSR).

--In addition, the effect of the transfer should be reflected on Line 2

of Column (C).

--Line 18 of Column C must also equal Line 2 of Column C.

Note: A separate JQSR is required for reporting FY 1996 II-B

transfers. (See TEGL No. 5-95, dated April 12, 1996.) The II-B

Column of the PY 1996 JQSR should be left blank.

2. Title III Worker Adjustment Formula Financial Report--(WFFR)

a. Transfers to or from title III should be identified in the

Remarks Box as a cumulative net amount to reflect a net plus or minus

dollar change to available title III Substate funds. The comment should

also identify both the sending PY and title/part and the receiving PY

and title/part. (See sample WFFR).

b. The effect of the transfer should be reflected on Line 10 of the

PY 1996 Column.

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[FR Doc. 96-21632 Filed 8-23-96; 8:45 am]

BILLING CODE 4510-30-C